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Working capital support – have you considered the General Export Facility?

Author: Julie Mole, Crowe UK

Published: 28 Jul 2022

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Julie Mole, from Crowe UK, shares some advice.

We continue to live in challenging times with businesses facing many demands, such as supply chain issues, staffing and rising energy and fuel costs. This can lead to cashflow pressure and many will turn to their Bank for traditional support, such as an Overdraft or Invoice Discounting.

However, there may be another way to fund your business through the UK Export Finance (UKEF) product offering, particularly if you are a growing business.

There are a number of ways UKEF may be able to help. We will focus on the General Export Facility (GEF), which has already helped a number of businesses.

So how can it help?

The General Export Facility provides partial guarantees to banks to help UK exporters to gain access to trade finance facilities. The working capital requirement does not even have to be export related, as long you have recently exported you may qualify.

The qualification requirements are:

  • evidence, in each of the last three years, of exporting at least 5% of sales turnover or
  • evidence of exporting at least 20% of sales in annual turnover in any one of the last three financial years.

The business must be UK based and goods and services provided from the UK.

How does it work?

UKEF provides a guarantee of up to 80% of the debt to the lender, de-risking the lender so their exposure is just 20% of the debt. How the lender decides to manage this risk is up to them.

The guaranteed bank pays UKEF a guarantee fee, which is a proportion of the interest margin paid by the business.

To apply, a business needs to approach one of the six lenders currently signed up to the scheme (preferably one where there is an existing relationship). The lenders are:

  • NatWest
  • Lloyds
  • HSBC
  • Barclays
  • Santander
  • Newable Business Loans
  • Virgin Money

Do you not meet the criteria for GEF?

UKEF can help in a variety of ways explained in more detail in UK Export Finance’s publication.

*The views expressed are the author's and not ICAEW's.
Funding for Export flowchart
Flowchart provided by Crowe UK